JEPI - JEPI: Probably Better As A Hedge Than Your Main Play
2024-04-02 09:33:48 ET
Summary
- JEPI's focus on low beta stocks make it a good bet on red years but causes it to underperform during green years as the fund's total beta is 0.5.
- Dividends are tied to the volatility levels of the market which means you are likely to see lower distributions when market is heading higher.
- These make this fund a decent hedge but it probably shouldn't be your main play since markets tend to go up far more often than not in the long run.
- I like this fund's sister fund JEPQ better for outperformance and higher yields.
JPMorgan Equity Premium Income ETF ( JEPI ) is probably the most popular covered call fund out there with its total assets approaching $35 billion. The fund has attracted a lot of attention from investors who are seeking income in recent years. Although the fund has been around for only a few years in its current shape, it originally started as a mutual fund in 2019 under JEPIX ( JEPIX ) which it still exists as a mutual fund but it's basically the same fund as JEPI. I've covered this fund before in the past with my most recent article from last year titled JEPI: Here Is Why It's Underperforming In 2023 And May Continue To Do So. ...
JEPI: Probably Better As A Hedge Than Your Main Play